Subchapter C. National Emission Standards for Hazardous Air Pollutants for Source Categories (FCAA §112, 40 CFR 63)

The Texas Natural Resource Conservation Commission (commission) adopts new §§113.170, 113.240, 113.410, 113.430, 113.460, 113.470, 113.480, 113.490, 113.530, 113.620, 113.640, and 113.660; and amendments to §§113.120, 113.200, 113.220, 113.250, 113.290, 113.340, and 113.380, concerning National Emission Standards for Hazardous Air Pollutants (NESHAPs) for Source Categories. The new sections and amendments are adopted without changes to the proposed text as published in the April 9, 1999 issue of the Texas Register (24 TexReg 2851) and will not be republished.

The new sections concern requirements that are contained in 40 Code of Federal Regulations (CFR) Part 63. The United States Environmental Protection Agency (EPA) is developing these national standards to regulate emissions of hazardous air pollutants under the Federal Clean Air Act (FCAA) Amendments, §112. These NESHAP for source categories are technology-based standards commonly referred to as Maximum Achievable Control Technology (MACT) standards.

The amendments incorporate changes that EPA has made to MACT standards by updating the federal promulgation dates cited in the commission rules that were previously adopted by reference. Sections 113.120, 113.220, 113.250, and 113.290 were adopted by the commission on June 25, 1997. Sections 113.200, 113.340, and 113.380 were adopted by the commission on October 15, 1997.

EXPLANATION OF ADOPTED RULES

The commission adopts by reference, without changes, 12 of the federal MACT standards. Under federal law, the affected industries will be required to implement these MACT standards regardless of whether the commission or EPA is the agency responsible for implementation of the standards. In addition to adopting these standards into Chapter 113, the commission is actively pursuing delegation of MACT standards from the EPA. Upon delegation, the commission will be responsible for administration and enforcement of the MACT requirements. The agency is adopting these rules as a step toward ensuring that the commission will eventually be the single point of contact for most MACT enforcement, notifications, reports, and other actions.

These 12 federal rules, each of which will be under its own division of the same name, are: Coke Oven Batteries, 40 CFR 63, Subpart L; Pulp and Paper Production, 40 CFR 63, Subpart S; Wood Furniture Manufacturing Operations, 40 CFR 63, Subpart JJ; Primary Aluminum Reduction Plants, 40 CFR 63, Subpart LL; Tanks - Level 1, 40 CFR 63, Subpart OO; Containers, 40 CFR 63, Subpart PP; Surface Impoundments, 40 CFR 63, Subpart QQ; Individual Drain Systems, 40 CFR 63, Subpart RR; Oil-Water Separators and Organic-Water Separators, 40 CFR 63, Subpart VV; Hazardous Waste Combustors, 40 CFR 63, Subpart EEE; Pharmaceuticals Production, 40 CFR 63, Subpart GGG; and Flexible Polyurethane Foam Production, 40 CFR 63, Subpart III.

The Hazardous Waste Combustor MACT provisions, promulgated in 40 CFR 63, Subpart EEE, represent only a portion of the MACT standard that was proposed by EPA. On June 19, 1996, EPA proposed the Hazardous Waste Combustor MACT. On June 19, 1998, EPA finalized portions of the MACT which include requirements for sources to provide a notification of intent to comply with the final rule, progress reports once the final rule is promulgated, and allowances for extensions to the compliance period. EPA finalized these MACT provisions early because under the FCAA, affected sources have three years (with a potential one-year extension) to comply with a MACT standard, whereas modifications to a Resource Conservation and Recovery Act permit may take several years to process. Therefore, EPA promulgated a streamlined approach to allow permit modifications designed to comply with MACT requirements. EPA will finalize the remaining portions of the MACT in the near future. This rulemaking includes adoption by reference of the streamlined approach already adopted by EPA. As with all MACTs, the commission will review the future EPA rulemaking on this subject and will incorporate the new standards as appropriate.

As other MACT standards continue to be promulgated, they will be reviewed for compatibility with current state regulations and policies. The commission will then incorporate them into Chapter 113 through formal rulemaking procedures. The commission will seek formal delegation from EPA under 40 CFR 63, Subpart E, which implements the FCAA Amendments, §112(l).

The commission adopts by reference the latest EPA amendments to seven of the federal MACT standards. The seven standards are: Synthetic Organic Chemical Manufacturing Industry for Process Vents, Storage Vessels, Transfer Operations, and Wastewater, 40 CFR 63, Subpart G, §113.120; Ethylene Oxide Sterilization Facilities, 40 CFR 63, Subpart O, §113.200; Industrial Process Cooling Towers, 40 CFR 63, Subpart Q, §113.220; Halogenated Solvent Cleaning, 40 CFR 63, Subpart T, §113.250; Secondary Lead Smelting, 40 CFR 63, Subpart X, §113.290; Petroleum Refineries, 40 CFR 63, Subpart CC, §113.340; and Aerospace Manufacturing and Rework Facilities, 40 CFR 63, Subpart GG, §113.380.

FINAL REGULATORY IMPACT ANALYSIS

The commission has reviewed this rulemaking in light of the regulatory analysis requirements of Texas Government Code, §2001.0225, and has determined that the rulemaking is not subject to §2001.0225 because it does not meet the definition of a "major environmental rule" as defined in the Texas Government Code. This rulemaking does not establish any new requirements beyond those already established by federal law. Affected sources are required to comply with these federal standards whether or not the commission adopts them.

TAKINGS IMPACT ASSESSMENT

The commission has prepared a takings impact assessment for this rulemaking under Texas Government Code, §2007.043. The following is a summary of that assessment. The specific purpose of this rulemaking is to facilitate implementation and enforcement of the MACT standards by the state. This rulemaking will not create any additional burden on private real property. Under federal law, the affected industries will be required to implement these MACT standards regardless of whether the commission or EPA is the agency responsible for implementation of the standards.

COASTAL MANAGEMENT PLAN CONSISTENCY REVIEW

The commission has determined that this rulemaking relates to an action or actions subject to the Texas Coastal Management Program (CMP) in accordance with the Coastal Coordination Act of 1991, as amended (Texas Natural Resources Code, §§33.201 et seq.), and the commission's rules in 30 TAC Chapter 281, Subchapter B, concerning Consistency with the CMP. As required by 31 TAC §505.11(b)(2) and 30 TAC §281.45(a)(3), relating to actions and rules subject to the CMP, commission rules governing air pollutant emissions must be consistent with the applicable goals and policies of the CMP. The commission has reviewed this rulemaking for consistency with the CMP goals and policies in accordance with the rules of the Coastal Coordination Council, and has determined that this rulemaking action is consistent with the applicable CMP goals and policies. The CMP policy applicable to this rulemaking action is the policy that commission rules comply with regulations in 40 CFR to protect and enhance air quality in the coastal area (31 TAC §501.14(q)). This rulemaking will adopt by reference, without changes, 12 federal MACT standards contained in 40 CFR Part 63 and is, therefore, consistent with this policy.

HEARING AND COMMENTERS

A public hearing was held in Austin on May 5, 1999. No oral comments were received at this hearing. Two commenters, the Styrene Information and Research Center and an individual, submitted written comments.

ANALYSIS OF TESTIMONY

The Styrene Information and Research Center expressed support for the commission adoption of the MACT standard for Wood Furniture Manufacturing Operations, 40 CFR 63, Subpart JJ, as amended through December 28, 1998.

The commission appreciates the support.

An individual expressed overall support of the rulemaking.

The commission appreciates the support.

The Texas Natural Resource Conservation Commission (commission) adopts amendments to §§305.2, 305.69, 305.125, 305.172, 305.174, 305.401 305.572, and 305.573, concerning consolidated permits. The amendments are adopted without changes to the proposed text as published in the April 16, 1999 issue of the Texas Register (24 TexReg 3022) and will not be republished.

EXPLANATION OF ADOPTED RULES The purposes of the adopted amendments are to revise the state rules to conform to certain federal regulations regarding public participation and permit modification procedures, to correct and reformat cross-references, to revise certain permit modification rules to clarify responsibilities and authority in the area of Class 2 modification requests, and to add public notice requirements for temporary authorizations. The adopted rules are intended, in part, to provide earlier opportunities for public involvement and expand public access to information throughout the permitting process and the operational lives of certain hazardous waste management facilities. The conforming changes are needed to establish equivalency with federal regulations and will enable the State of Texas to retain authorization to operate aspects of the federal hazardous waste program in lieu of the United States Environmental Protection Agency (EPA). The federal regulations to which the public participation rules are being conformed were promulgated by the EPA on December 11, 1995, at 60 FedReg 63417, and are found at 40 Code of Federal Regulations (CFR) Part 270, Subpart C, which relates to permit conditions, and Subpart F, which relates to special forms of permits. The federal regulations to which the permit modification rules are being conformed were promulgated by the EPA on June 19, 1998, at 63 FedReg 33782. These regulations concern hazardous waste combustor facility permits and are found at 40 CFR §270.42, which relates to permit modification at the request of the permittee.

FINAL REGULATORY IMPACT ANALYSIS The commission has reviewed the rulemaking in light of the regulatory analysis requirements of Texas Government Code, §2001.0225, and has determined that the rulemaking is not subject to §2001.0225 because it does not meet the definition of a "major environmental rule." "Major environmental rule" means a rule the specific intent of which is to protect the environment or reduce risks to human health from environmental exposure and that may adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector of the state. This rule is not adopted with the specific intent of protecting the environment or reducing risks to human health or the environment. The specific intent of the rule is to provide earlier opportunities for public involvement with regard to authorization of certain hazardous waste management activities; expand public access to information throughout the permitting process and the operational lives of certain hazardous waste management facilities; revise the permit modification rules to add a permit modification procedure and to clarify responsibilities and authority in the area of Class 2 modification requests; and correct and reformat cross-references. In addition, the rulemaking is not a major environmental rule because it will not adversely affect in a material way the aforementioned aspects of the state because the rule simply updates the state's hazardous waste regulations by revising the rules to conform to certain federal hazardous waste regulations, adds enhanced public participation and permit modification procedures to Chapter 305, and corrects cross-references in the rules. The rulemaking, in part, is specifically required by federal law because states such as Texas that are authorized to administer and enforce the RCRA program in lieu of EPA under §3006 of RCRA are required to modify their programs by adopting equivalent requirements, as necessary. See 40 CFR §271.21(e). The delegation agreement between the commission and EPA expressly requires the commission to maintain RCRA authorization. Any other portions of the adoption which clarify or modify state rules, such as the clarification of authority and responsibilities of the commission and the executive director and adding public notice requirements for temporary authorizations, though not specifically required by the delegation agreement, do not exceed the delegation agreement. Finally, this rulemaking is not being adopted on an emergency basis to protect the environment or to reduce risks to human health from environmental exposure.

TAKINGS IMPACT ASSESSMENT The commission has prepared a takings impact assessment for these rules pursuant to Texas Government Code Annotated §2007.043. The following is a summary of that assessment. The specific purposes of the adopted rules are to ensure that Texas' state hazardous waste rules are equivalent to the federal regulations after which they are patterned, thus enabling the state to retain authorization to operate its own hazardous waste program in lieu of the corresponding federal program, to correct and reformat cross-references, to revise certain permit modification rules to clarify responsibilities and authority in the area of Class 2 modification requests, and add public notice requirements for temporary authorizations. The adopted rules will substantially advance this stated purpose by referencing specific federal regulations or by introducing language intended to ensure that state rules are equivalent to the corresponding federal regulations for hazardous waste facilities; by correcting and reformatting cross-references; by clarifying where the executive director and the commission have authority and responsibilities in the Class 2 modification rules, and by adding public notice requirements for temporary authorizations. Promulgation and enforcement of these rules will not affect private real property which is the subject of the rules because the adopted language consists of changes to cross-references, clarification of authority and responsibilities of the commission and the executive director, public notice requirements for temporary authorizations, and technical corrections and updates to bring certain state hazardous waste regulations into equivalence with more recent federal regulations, which would increase public participation, thus providing the benefits of expanded public access to information throughout the permitting process and the operational lives of certain hazardous waste management facilities. These requirements give applicants a better opportunity to address public concerns in making decisions about the facility and in subsequent trial burn and permitting activities. The subject regulations do not affect a landowner's rights in private real property because this rulemaking does not restrict or limit the owner's right to property that would otherwise exist in the absence of the regulations. That is, a property owner may continue to use the property for the management of hazardous waste. In other words, since these rules merely revise public participation and notice requirements, revise permit modification procedures applicable to the executive director's staff, and correct and reformat cross-references, they do not restrict the owner's right to property. Also, the following exception to the application of Chapter 2007 of the Texas Government Code listed in Texas Government Code, §2007.003(b) applies in part to these rules: this action is reasonably taken to fulfill an obligation mandated by federal law. See Title 40 CFR §271.21(e)(1), which states that as the federal hazardous waste program changes, authorized state programs such as the commission's hazardous waste program must be revised to remain in compliance with 40 CFR Part 271, Subpart A.

COASTAL MANAGEMENT PROGRAM The commission has reviewed the rulemaking and found that the adoption is a rulemaking subject to the Texas Coastal Management Program (CMP) and must be consistent with all applicable goals and policies of the CMP. The commission has prepared a consistency determination for the adopted rule pursuant to 31 TAC §505.22 and has found that the rulemaking is consistent with the applicable CMP goals and policies. The following is a summary of that determination. The CMP goals applicable to the rulemaking are to protect, preserve, restore, and enhance the diversity, quality, quantity, functions, and values of coastal natural resource areas (CNRAs). CMP policies focus on construction and operation of solid waste treatment, storage, and disposal facilities, such that new solid waste facilities and areal expansions of existing solid waste facilities shall be sited, designed, constructed, and operated to prevent releases of pollutants that may adversely affect CNRAs and, at a minimum, comply with standards established under the Solid Waste Disposal Act, 42 United States Code Annotated, §6901 et seq.

Promulgation and enforcement of this rule are consistent with the applicable CMP goals and policies because the rule amendments will update and clarify certain permit modification rules, including clarification of authority and responsibilities of the executive director and the commission, and update and enhance the commission's rules concerning public participation in the hazardous waste area by expanding public participation and notice as well as public access to information throughout the trial burn and permitting process for certain hazardous waste management facilities. These rules do not address protection, preservation, restoration, or enhancement of the diversity, quality, quantity, functions, or values of CNRAs, nor do they relate to the siting, design, construction, or operation of solid waste treatment, storage, or disposal facilities. Thus, the adopted rule does not violate any applicable provisions of the CMP's stated goals and policies, because there are no applicable CMP goals or policies that this rule could violate.

HEARINGS AND COMMENTERS The commission did not hold a public hearing on the proposed rule changes. The comment period for the proposed rules closed at 5:00 p.m., May 17, 1999. There were no comments received.

Subchapter A. General Provisions

Subchapter A. Used Oil Recycling

The Texas Natural Resource Conservation Commission (commission) adopts amendments to Subchapter A, §§324.1-324.7, 324.11-324.16, 324.21, and 324.22; and the repeals of §§324.8-324.10; concerning Used Oil Recycling. Sections 324.1, 324.4-324.7, 324.11-324.16, 324.21, and 324.22; and the repeals of §§324.8-324.10 are adopted without change to the proposed text as published in the March 12, 1999, issue of the Texas Register (24 TexReg 1741) and will not be republished. Section 324.2 and §324.3 are adopted with changes to the proposed text as published.

The commission also readopts Chapter 324, Subchapter A, as required by the General Appropriations Act (Act), Article IX, §167, 75th Legislature, 1997. Section 167 requires state agencies to review and consider for readoption rules adopted under the Administrative Procedure Act. The review must include, at a minimum, an assessment that the reason for the rules continues to exist. The commission has reviewed the rules in Chapter 324, Subchapter A, and determined that the reasons for adopting those rules continue to exist. The rules are necessary to encourage the recycling of used oil; to protect the environment from used oil contamination; to implement Texas Health and Safety Code Chapter 371, Used Oil Collection, Management, and Recycling; and to implement 40 Code of Federal Regulations (CFR), Part 279, Standards for the Management of Used Oil.

EXPLANATION OF ADOPTED RULES

The commission has conducted a regulatory reform review of the rule and is adopting amendments and repeals to improve the readability of the rule. Generally, readability is improved by deleting repeats of legal statutes; by providing lists where possible; by providing more logical sequencing; by reducing word, paragraph and sentence lengths; by eliminating unnecessary words; replacing complex or out-of-date words with simpler ones; and by any other changes that make the meaning clearer or reading easier. Readability changes should not cause a rule requirement to become more or less stringent. In most instances, the word "shall" was replaced with the word "must" because the word "shall" is not commonly used in normal conversation and correspondence and is not necessary to make rule requirements legally enforceable.

Section 324.2 has been changed from the proposed version. In the §324.2(6) definition of "re-refining," the language giving examples of re-refining has not been deleted as proposed because a commenter felt that it made the definition clearer. The deletion was only proposed because less words are generally believed to make a rule more readable. Although the commission intends to make the rule more readable, it does not insist on a wording deletion if someone in the regulated community feels that the deletion makes the rule less clear. Also, a definition of "earthen area" has been added at §324.2(11) because this was requested by a commenter and it merely repeats wording already reflected in §324.22(c). Restating this information in the definitions section can do no harm and may help the users of the rule.

Section 324.3 has been changed from the proposed version. In §324.3(1), the word "waste" has been added back into the first line where it had been inadvertently omitted in the proposed version. In §324.3(3), in the fourth sentence, the word "hazardous" has been added back in front of "ignitability characteristic" as requested by a commenter. The deletion of this word was only proposed because less words are generally believed to make a rule more readable. Although the commission intends to make the rule more readable, it does not insist on a wording deletion if someone in the regulated community feels that the deletion makes the rule less clear.

SMALL BUSINESS ANALYSIS

The commission has reviewed the adopted rulemaking in light of Texas Government Code, §2006.002, requirements and has determined that there is no adverse economic effect on small businesses because the readability changes are not intended to cause a rule requirement to become more or less stringent and this rulemaking does not amend any underground storage tank rule requirement.

FINAL REGULATORY IMPACT ANALYSIS

The rulemaking does not affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector of the state because it merely improves the readability of the used oil recycling rule requirements without making them more or less stringent. Therefore, this rulemaking does not constitute a major environmental rule.

Chapter 324 implements federal law regarding used oil recycling in 40 CFR Part 279, Standards for the Management of Used Oil.

TAKINGS IMPACT ASSESSMENT

The commission has prepared a Takings Impact Assessment for these rules pursuant to Texas Government Code §2007.043. The following is a summary of that assessment. The specific purpose of the rulemaking is to improve the readability of Chapter 324, Subchapter A, concerning Used Oil Recycling. The rules will substantially advance this specific purpose by amending or repealing all of the rule sections in Chapter 324, Subchapter A. Promulgation and enforcement of these rules will not burden private real property which is the subject of the rules because they improve the readability of used oil recycling rule requirements without making them more or less stringent.

Also, the following exception to the application of Chapter 2007 of the Texas Government Code listed in Texas Government Code §2007.003(b) applies to Chapter 324: the rulemaking is an action reasonably taken to fulfill an obligation mandated by federal law.

COASTAL MANAGEMENT PROGRAM CONSISTENCY REVIEW

The commission has reviewed the adopted rulemaking and found that the rule is neither identified in Coastal Coordination Act Implementation Rules, 31 TAC §505.11, nor will it affect any action/authorization identified in Coastal Coordination Act Implementation Rules, 31 TAC 505.11. Therefore, the adoption is not subject to the Coastal Management Program. In addition, this rulemaking does not amend any underground storage tank rule requirement or make any Chapter 324, Subchapter A, used oil recycling rule requirement more or less stringent.

HEARING AND COMMENTERS

A public hearing was not held for this rulemaking. The comment period closed April 12, 1999. Written comments were submitted by Central and South West Services, Inc.

ANALYSIS OF COMMENTS

On §324.2(6), the commenter felt that the deletion of the phrase containing examples of re- refining, i.e., "including settling, filtering, catalytic conversion, fractional/vacuum distillation, hydro treating, or polishing," made the definition less clear.

The commission agrees to retain these examples of re-refining in §324.2(6). The deletion was only proposed because fewer words are generally believed to make a rule more readable. The commission does not, however, support sacrificing clarity for streamlining. The examples proposed for deletion have been retained in §324.2(6).

On §324.2(10), the commenter stated that there is no mention of marketer in the definition of used oil handler.

The commission agrees with the commenter. However, the omission of marketer from the definition of used oil handler is intentional. The commission only uses the term used oil handler to define which entities are subject to the state requirement for financial responsibility. A marketer is someone who either directs a shipment of off-specification used oil to a burner or is the first to claim that his used oil is on-specification. Therefore, a generator could be a marketer, and the state's financial responsibility requirement is not intended to apply to generators. That is why the term marketer is intentionally omitted from the definition of a used oil handler. No rule change was made in response to this comment.

On §324.2, the commenter stated that "earthen area" should be defined as "the active area of the facility is the earthen area at the facility over which any transportation, storage, or processing of used oil occurs.

The commission agrees to define earthen area in §324.2 as recommended by the commenter. This wording is already reflected in §324.22(c), and restating it in the definitions section may help the users of the rule. The earthen area definition has been added as §324.2(11), as recommended by the commenter.

On §324.3(1), the commenter felt that the requirement to use EPA Hazardous Waste Number F002 for used oil that is listed hazardous due to mixing with halogenated contaminants was incorrect.

The commission agrees that EPA Hazardous Waste Number F002 is normally used for spent halogenated solvents and not used oil. However, under the federal used oil rule that Chapter 324 implements, used oil that contains greater than 1,000 ppm total halogens is assumed to be listed hazardous due to mixing with listed hazardous halogenated wastes. An EPA Hazardous Waste Number is required to manifest and transport a hazardous waste and the federal used oil rule, 40 CFR Part 279, does not specify an EPA Hazardous Waste Number for used oil that contains greater than 1,000 ppm total halogens. Used oil is usually made a "listed" hazardous waste by mixing with halogenated solvents. Therefore, because an EPA Hazardous Waste Number is absolutely required to manifest a hazardous waste and the federal used oil rule did not provide one for used oil that contains more than 1,000 ppm total halogens, the commission selected the EPA Hazardous Waste Number F002 for spent halogenated solvents as the best choice to use in manifesting such used oil. No rule change was made in response to this comment.

On §324.3(2), the commenter stated that the rule statement that used oil can be stored in tanks and containers not meeting 40 CFR Part 264 or 265 might conflict with the federal rule on used oil, 40 CFR Part 279.

The commission does not agree that the rule statement conflicts with the federal rule, 40 CFR Part 279. The federal rule states: "Used oil generators shall not store used oil in units other than tanks, containers, or units subject to regulation under parts 264 or 265 of this chapter." The commission agrees that the federal rule could easily be interpreted to mean that used oil must be stored in tanks and containers regulated under 40 CFR Parts 264 or 265. However, in a subsequent preamble changing the first version of the federal rule (Fed Reg 26422, May 3, 1992) and subsequent training and guidance, the Environmental Protection Agency (EPA) explained that the federal rule should not be interpreted to require that used oil be stored in tanks and containers regulated under 40 CFR Parts 264 or 265. That is why the commission added §324.3(2) to the state used oil rule, i.e., to explain that used oil can be stored in tanks and containers not regulated under 40 CFR Parts 264 or 265. EPA intended only to restrict used oil storage in surface impoundments. No rule change was made in response to this comment.

On §324.3, the commenter requested that the word "hazardous" be retained in the statement: "However, the resultant mixture cannot exhibit the (hazardous) ignitability characteristic."

The commission agrees to retain the word "hazardous" in this rule statement. The deletion was only proposed because fewer words are generally believed to make a rule more readable. The commission does not, however, support sacrificing clarity for streamlining.

On §324.12(3), the commenter stated that the requirement for the processor to include in his analysis plan "procedures for handling a shipment of contaminated used oil" is not in the federal used oil rule and should not be included in the state rule.

The commission agrees with the commenter that this wording is not in the federal rule. However, the commission notes that this wording is derived from the preamble for the original federal rule (Fed Reg 41597, September 10, 1992) which states: "In addition, EPA believes that an analysis plan will also indicate a procedure for handling a shipment of adulterated used oil if received by a used oil processor/re-refiner facility especially when the given facility is not a co-management facility (i.e., permitted to manage hazardous waste)." The commission considers it reasonable to require that the analysis plan indicate a procedure to properly handle adulterated used oil. However, the commission interprets that the analysis plan exemption under §324.12(3)(A)-(B), for a facility which only processes its own used oil and uses process knowledge instead of analysis, applies to a holding company and its sister operating companies if (1) sister operating companies ship used oil to each other for processing; (2) the holding company has incorporated common policies, procedures, and sampling protocols for sister operating companies; and (3) communication takes place between the companies on their process knowledge of the oil involved. The commenter was satisfied with this interpretation and no change was made to the rule in view of this interpretation of the rule.

On §324.22, the commenter was concerned that the financial responsibility requirement exemption statement "does not apply to a used oil handler which is owned or otherwise effectively controlled by the owners or operators where the used oil is generated," might be interpreted not to apply to geographically separate sites under the same ownership, such as substations and sister operating companies under a utility holding company. The commenter felt that the exclusion should not be geographically specific.

In discussions with the commenter, the commission agreed that the exclusion is not geographically specific and applies to used oil generated at all owned facilities of a used oil handler. With this agreement between the commission and the commenter on proper interpretation of the rule, there was no need to change the rule language in response to this comment.